2019 Cryptocurrency (Elliott Wave): Christmas Updatehttps://www.reddit.com/r/BitcoinMarkets/comments/ef65re/2019_cryptocurrency_elliott_wave_christmas_update/Summary: Bitcoin remains in a bull market with an outlook to exceed the 2017 high. However, a price move below $5000 suggests Bitcoin is in a bear market, with price headed to break below the 2018 lows. The majority of Altcoins favour an extended bear market unless an intervention can be coordinated. The outlook for the stockmarket, in particular the USA, is extremely bullish.
From an Elliott Wave perspective, two scenarios are under consideration at this inflection point: a continuing
Bull Scenario or a
Bear Scenario.
In either scenario, the Elliott Wave model proposes a five wave structure, consisting of: three advancing bull market waves, interwoven with two declining bear market waves. Overlaying this model onto Bitcoin suggests:
Wave-1: the first bull market wave 2010-2013 (1219 days), followed by;
Wave-2: the first bear market wave 2013-2015 (426 days), followed by;
Wave-3: the second bull market wave 2015-2018 (1065 days), followed by;
Wave-4: the second bear market wave 2018-2019 (363 days), followed by;
Wave-5: the third and final bull market wave 2019-?
The five aforementioned have been considered as PRIMARY degree waves —such waves elapse the course of a few months to a couple of years. Each PRIMARY degree wave is constituted of five INTERMEDIATE degree waves; and in turn, so forth into smaller degree fractals.
The
Bull Scenario suggests Wave-5 is still underway, with subdividing and extending waves headed for new all-time highs.
The
Bear Scenario suggests Wave-5 completed at the 26-JUN-2019 high as a truncated fifth wave failure, and a bear market is underway. The majority of Altcoins favour an ongoing bear market.
Bull ScenarioThe bullish scenario suggests a continuing bull market is underway. PRIMARY[5] wave started from the 06-FEB-2019 low, and has completed its first parabolic uptrend labelled as INTERMEDIATE(1) wave at the 26-JUN-2019 high.
Since the 26-JUN-2019 high, INTERMEDIATE(2) wave pullback has been underway and has thus far declined 55% into the low of 18-DEC-2019.
The structure of INTERMEDIATE(2) wave decline has thus far unfolded as three A-B-C waves of MINOR degree as follows:
—Wave-A decline started at the high of 26-JUN-2019 and completed as a complex structure at the low of 23-OCT-2019.
—Wave-B bounce started at the low of 23-OCT-2019 when the market suddenly spiked and surged over 40% within a day —attributed to news of Chinese leader Xi Jinping reportedly stating China should “seize the opportunity” offered by blockchain. The surge was the third largest 24-hour price gain in Bitcoin's history and a simple structure completed at the high of 26-OCT-2019.
—Wave-C decline has been underway since the high of 26-OCT-2019. At the low of 18-DEC-2019, Wave-C reached a Fibonacci 0.618% of Wave-A in length on notable BITFINEX and COINBASE exchanges; in addition, created positive divergence of price against momentum indicators such as the Relative Strength Index on the daily timeframe.
Given the potential of a completed correction as described in the aforementioned A-B-C decline, the market has arrived at a juncture to consider the end of INTERMEDIATE(2) wave decline at the 18-DEC-2019 low.
To provide any credibility to this consideration, price is required to rise from the 18-DEC-2019 low and exceed the high of 29-NOV-2019. In addition, price Is required to unfold in five impulsive i-ii-iii-iv-v rising waves. Thus far as of Christmas Eve, price has risen in one wave from the 18-DEC-2019 low and is below the 29-NOV-2019 high.
Alternatively, the INTERMEDIATE(2) wave decline is still to further subdivide and extend lower. A decline below the 18-DEC-2019 low confirms an ongoing INTERMEDIATE(2) wave decline. The following Fibonacci-based levels may be sought as support zones to conclude the pullback; using COINBASE pricing:
@5431: 78.6% Fibonacci retracement of the entire INTERMEDIATE(1) wave from 15-DEC-2018 to 26-JUN-2019.
@5374: MINOR C = MINOR A * 0.786
@4358: 88.6% Fibonacci retracement of the entire INTERMEDIATE(1) wave from 15-DEC-2018 to 26-JUN-2019. [WARNING: Bull Market Terminated?]
Using the Greyscale Bitcoin Fund (GBTC) as a proxy to Bitcoin, the rise from the 18-DEC-2019 low thus far, as of Christmas Eve, appears corrective. Therefore, price action currently favours an ongoing decline:
Once INTERMEDIATE(2) wave pullback has completed, a rising INTERMEDIATE(3) is expected to commence and resume the bull market. Such a wave is expected to unfold parabolically in nature, and at a minimum, meet or exceed the PRIMARY[3] high set on 17-DEC-2017. In both price and time, this wave is expected to be the longest of the PRIMARY[5] bull market.
Where the PRIMARY[5] bull market ends is open to interpretation and speculation.
From an Elliott Wave perspective: A common wave relationship guides the price of the fifth wave to be equal to; or extend a Fibonacci 1.618 or 2.618 times; the length from the low of the first wave through to the high of third wave; projected from the low of the fourth wave. This provides a conservative target of the current bull market to conclude between $22,912 or $35,127 or $54,892, calculated using the BraveNewCoin (BLX) index:
@22912: PRIMARY[5] = (PRIMARY[1] + PRIMARY[3]) * 1
@35127: PRIMARY[5] = (PRIMARY[1] + PRIMARY[3]) * 1.618
@54892: PRIMARY[5] = (PRIMARY[1] + PRIMARY[3]) * 2.618
As and when the waves develop and progress, and in the event of subdividing and extending waves, revised price targets shall be calculated with renewed projections.
Bear ScenarioThe bear market scenario suggests the 2019 bull market was a short-lived affair, and PRIMARY[5] terminated as a failed-fifth truncated wave.
PRIMARY[5] started from the 15-DEC-2018 low and completed at the 26-JUN-2019 high. A Fibonacci 88.6% retracement of this uptrend is at 4350 COINBASE —a decline to this point ought to signal the market has favoured to deflate.
In this scenario, five completed PRIMARY degree waves have completed a CYCLE I wave structure. And now, a CYCLE II wave bear market pullback is underway and headed to break below the 2018 low.
The wider cryptocurrency market in terms of the Altcoins currently appear to support the outlook of a bear market. So far in 2019, the price structure of majority Altcoins has seemingly unfolded in corrective A-B-C advancing waves, instead of impulsive 1-2-3-4-5 waves. This suggests the majority of Altcoins may be set to break their respective 2018 lows unless an intervention can be coordinated…
StockmarketThe outlook for the major global equity stockmarkets, in particular the USA, is extremely bullish.
From the 2009 low of the great financial crises, the Dow Jones Industrial Average index has risen in four PRIMARY degree waves, with a fifth and final rising wave underway which began from the low of 2018.
In 2020, the stockmarket will be entering its 11th bull market year since the low of 2009. Fibonacci numbers next in sequence are 13, 21, 34. Therefore, the stockmarket isn’t likely to run into major headwinds until 2022; or until 2030 if the bull market extends to 21 years:
Since the Brexit vote in 2016, the UK FTSE100 has been directionless. With clarity now emerging on Brexit since the 12-DEC-2019 UK election, the FTSE100 is poised to resume a strong bull market:
Analysis is purely speculative, and projections are indicative of price & structure, not time. Merry Christmas!
